How Sequoia Capital Stays On Top | Forbes

can you talk about your view on the health of the venture industry right now the venture industry is both quite vibrant and quite competitive when we first called the CEO of ServiceNow fred ludie he he was getting call from every venture firm Under the Sun and so we had to go the extra mile to try to convince Fred that we were quite different and that we could help them to build a business how do you pitch that and then how do you deliver on that well it's not exactly a pitch it's an understanding of business where you meet with a CEO or a founder and you talk about sales engineering product management and give some ideas or suggestions and the founder quickly understands that you really can help them both operationally and from a strategic standpoint and in those conversations then you build trust and by doing so he really starts to believe that you can help him and that's how he chooses you as an investor and as a business partner for the long term for Sequoia as a firm last year you had a little bit of change in leadership can you talk about how things have changed since Michael Moritz made his announcement things not really change that much we have tried to build Sequoia Capital in the same eye for the long term that we really look for companies that we like to partner with and so when Sequoia had begun 40 years ago it was a named Valentine ventures it didn't have people's names on a door we work very hard at making sure we didn't have a single point of failure Mike and I were there to managing partners if you will for the last 15 16 years and so with Mike he decided to back off for health reasons and spend a lot of time with young companies we had a backup plan in place that was built in so nothing much has changed if anything we have more of Mike Moritz now in a venture business can you talk a little bit more about that philosophy in terms of the team concept with Sequoia how all the partners are involved and how you work with entrepreneurs we call ourselves business partners and not investors for the simple reason that we're there with them every step of the way whether it be a seed investments like YouTube or Palo Alto Networks or some of the many other type of seeds we spend a lot of time or companies like Meraki where we did a series a investment and we had to go through four generations of business plan meeting every week until we finally hit on the business plan that work and of course as you know we sold the moroccan company along with a founder and CEO for Cisco for a billion - just a few months ago it seems like in the venture industry lately there's been a lot of VC firms doing PR marketing and that type of thing how do you think about that whole area well I'm quite embarrassed by it I want to start by saying that because our business is all about helping someone a founder a CEO a team building a great business it is not about seeing our names in the press I am not quite sure why firms go and do that why venture firms go do that it might be for ego reasons it may it might be because they think they're gonna get more deal flow but the founders and the management teams do 95% of the work they're the ones that should be in the limelight furthermore if you put a founder and a company in the limelight they're more likely to get customers and notice that a number of your companies and some of your partners you your model is to do the series a investment and stay on through the IPO if possible longer on the board our sweet spot is staying through the IPO and two or three years after the IPO while making sure with distributor shares during very healthy times we're really really strong you know in helping create a business through maybe three four five hundred million dollar run rate at some point the company gets so large that we think they should have a much more professional board so made up of people whose strength is to lead it is is to be on the board of those kinds of companies you're talking about your office space can you talk about your your firm's philosophy on that I think the office space really flows down from our culture and our beliefs we are a very flat organization here we call everybody partner so if we hire a young investor and I'm one of the older people I'll introduce some or her as a partner we all used to have great offices and about a year ago what we decided to do is move into open space with standup desks we are sitting by themes so we'll have a mobile theme an Internet theme an infrastructure theme so we can have a lot of communications no fancy are that's a quick capital the only art is is a tchotchke from one of our companies or a poster from one of our companies right how do you stay you know on top you know hungry and like you're saying in such a competitive industry I think Sequoia looks for people like I am people from humble backgrounds as I said more some of us are immigrants who something happened in our lives early on maybe our system were shocked and we have this unbelievable need to stay on top and to succeed it is a drive that will never end until I die and many many of the people we hire if not all the people we hire seem to have that same Drive

Channel: Forbes

Views: 24,056

Rating: 4.9389315 out of 5

Keywords: Douglas Leone, Sequoia Capital, venture capital, VC, investment, investor, funding, interview, Forbes, MIDAS, Midas list, Silicon Valley

Id: WZ3yho0dygw

Length: 5min 27sec (327 seconds)

Published: Wed May 08 2013